These are different products covering different risks. You need both — they don’t overlap.
Homeowners insurance covers sudden, accidental events: fire, theft, wind, hail, lightning strikes, pipe bursts from freezing. It protects the structure and your belongings.
Home warranty covers mechanical breakdown from normal wear and tear: HVAC systems failing, appliances wearing out, plumbing leaks from aging pipes. It covers the systems and appliances.
| Event | Homeowners Insurance | Home Warranty |
|---|---|---|
| Fire damage | ✓ | ✗ |
| Wind/hail roof damage | ✓ | ✗ |
| Theft | ✓ | ✗ |
| Lightning strike damage | ✓ | ✗ |
| Pipe burst from freezing | ✓ (sudden) | Sometimes (depends on cause) |
| Liability (someone injured) | ✓ | ✗ |
| HVAC system wears out | ✗ | ✓ (with caps) |
| Appliance breaks down | ✗ | ✓ (with caps) |
| Water heater fails from age | ✗ | ✓ |
| Electrical failure from wear | ✗ | ✓ |
| Sewer line collapse (aging) | ✗ | ✗ (separate HomeServe) |
| Foundation issues | ✗ | ✗ |
| Flood damage | ✗ (need flood policy) | ✗ |
| Mold remediation | Sometimes (sudden cause) | ✗ |
Some events fall between both products:
Yes, if you own a home. They’re not substitutes. Homeowners insurance is typically required by your mortgage lender. A home warranty is optional but valuable for older homes or high-HVAC-cost markets.
“My insurance should cover my HVAC.” No. Homeowners insurance doesn’t cover mechanical breakdown. A 15-year-old AC that fails from wear is a home warranty claim, not an insurance claim.
“My home warranty covers flood damage.” No. Flood requires a separate NFIP or private flood policy. Home warranties don’t cover water intrusion from outside.
“My home warranty covers structural damage.” No. Foundation cracks, roof replacement from aging, structural wood rot — none of these are home warranty items.
A covered plumbing failure that causes water damage: the warranty covers the pipe repair; your homeowners insurance may cover the resulting water damage to flooring and walls. These work together — the warranty fixes the cause, insurance covers the resulting damage.